Why business owners need a carefully planned Will

If you own a business, your Will is not just about personal assets, it is a key document for business succession, tax planning and continuity.

Without the right planning in place, your death or loss of capacity could create uncertainty for your family, your fellow shareholders or partners, and your employees at a critical time. A well‑structured Will helps ensure the business you have worked hard to build can continue, whilst protecting those who depend on you.

Why is a Will particularly important for business owners?

A Will determines what happens to your estate, including business interests such as:

• shares in a limited company
• partnership or LLP interests
• sole trader business assets.

If you die without a Will, these assets are distributed under the rigid rules of intestacy. These rules do not consider modern business structures, shareholder arrangements or blended families. The result can be unintended beneficiaries inheriting business interests, disputes between surviving owners and family members, or even the forced sale of the business.

A properly drafted Will gives you control and certainty, ensuring your business interests pass in a way that supports both your family and the ongoing success of the business.

Business property relief: a crucial tax planning opportunity

Under the current rules, a carefully drafted Will can take full advantage of business property relief (BPR), which can significantly reduce or remove inheritance tax on qualifying business assets.

For example, your Will can provide for assets qualifying for BPR to pass into a discretionary trust or to chargeable beneficiaries, such as children. This allows the relief to be claimed at the earliest possible stage, helping to preserve business value and reducing the risk that assets will need to be sold to fund an inheritance tax liability.

Because BPR eligibility can be affected by business structure, ownership changes and how assets are passed on, it is vital that your Will is drafted with a trusted legal adviser and reviewed regularly.

Succession planning beyond the Will: getting the structure right

A Will is essential, but it should not exist in isolation. Your legal and ownership structure, and any agreements regulating your interests, are just as important.

Depending on how your business operates, this may include a partnership agreement for partnerships or LLPs; or articles of association and potentially a shareholders’ agreement for limited companies.

These agreements can set out what happens if a shareholder or partner dies or wishes to exit the business. Some shareholders’ agreements include provisions giving business partners the option to buy a departing shareholder’s shares on death, and such option would usually trump any wishes set out in one’s Will. This ensures the business remains in the hands of those running it; and the deceased owner’s family receives the value of the shareholding. It is important that your Will knits together with such agreements.

The right to buy a departing shareholder’s shares can also be included in a cross‑option agreement, which is often backed by life insurance which pays out in death to fund the purchase of the shares.

Your financial or tax adviser can help with arranging the insurance, but it is essential that the agreement itself dovetails with your Will and your company’s articles of association.

Safeguarding your business if you lose capacity: Lasting Powers of Attorney

When thinking about your Will, it is equally important to consider Lasting Powers of Attorney (LPAs).

An LPA allows you to appoint someone you trust to make decisions on your behalf if you lose mental capacity due to illness or an accident. For business owners, this is particularly critical.

Putting LPAs in place alongside your Will helps ensure the business can continue to operate smoothly, even if you are temporarily or permanently unable to manage affairs yourself.

How often should a business owner review their Will?

Your Will should be reviewed at least annually, and immediately if:

• you start, sell or restructure a business
• shareholdings or partnership interests change
• new shareholders or partners are introduced
• your family circumstances change.

Regular reviews ensure your Will remains aligned with your business agreements, tax planning and personal wishes.

Thinking about updating your Will? Speak to our trusted legal advisers

If you are a business owner, entrepreneur or shareholder, having the right Will and supporting documents in place is essential to protect your family, colleagues and commercial legacy.

While business‑owner Wills often involve more layers, the process itself does not have to be difficult with the right advice.

Our Wills, trusts and probate team regularly advise business owners in collaboration with our corporate specialists. Our trusted advisers take time to understand:

• your business structure and agreements
• who is involved now and who may be in the future
• your personal and commercial priorities
• how best to integrate tax and succession planning.

We provide clear, practical guidance and bespoke solutions that evolve as your business grows and changes. Clients often find the process far more straightforward, and reassuring, than they expected.

Get in touch to start the conversation.